As a result – in addition to the Dow’s new high – the S&P 500 posted its strongest month since April and the Russell 2000, which has tracked smaller companies’ stocks since 1984, saw its largest increase on record. “While the vaccine will likely not be widely available to the general public until the first quarter of 2021, at the earliest, the positive efficacy results through the vaccine trials led some of the most virus-sensitive companies’ stocks to outperform,” Raymond James Chief Investment Officer Larry Adam said. Looking more broadly at the economy, indicators continue to show signs of improvement, but at a more moderate pace compared to summer – surging infection rates through the holiday season pose a downside risk to the economy into early 2021. “A number of fiscal policy initiatives are (also) set to expire at year-end and the prospects for further support from Congress remain uncertain,” Chief Economist Scott Brown said. “However, the economy is expected to pick up significantly as vaccines are distributed next year.” Before we dive into D.C. and beyond, let’s look at where the domestic equity markets are as we approach the end of the year: Now to the details: Georgia on everybody’s mind While there was hope that the election would calm political tempers and make it easier for the House, Senate and administration to reach a fiscal stimulus compromise, the continuing contests to decide the leadership of the Senate may have thrown those wishes to the wind. “The back and forth on partisan positions for the next fiscal bill continues, and we view the politics of the Georgia runoff races as playing a significant role,” Washington Policy Analyst Ed Mills said. “We expect positions to become clearer once Congress returns from the Thanksgiving recess.” Comments from Ron Klain, presumptive President-elect Joe Biden’s chief of staff, suggest Biden is supporting a compromise package during the lame duck period, possibly in line with the $1.5 trillion package proposed by the House’s bipartisan Problem Solvers Caucus, but significant hurdles remain. It’s not just equities Hopes for the eventual return to normalcy pushed credit spreads, both high yield and investment grade, to new COVID-19-era lows and pushed energy prices to the highest level since March. We also saw the biggest bond yield swings since the start of the pandemic. Demand for corporate debt continues to be strong, and both municipal and corporate bonds outperformed Treasuries through the month. Oil prices, however, “will likely remain choppy over the next three to four months,” Energy Analyst Pavel Molchanov said. “Although current lockdown restrictions across Europe and a dozen U.S. states are milder than the original ones in March and April, the amount of population affected is so large that impact on transportation and traffic is still unavoidable.” The bottom line The markets are showing a sense of optimism for the year ahead, as evidenced by some of the most sensitive sectors’ outcomes through November. “We saw energy stocks trading up 39%, financials up 20% and industrials up 18% in just 17 days,” said Joey Madere, senior portfolio strategist, Equity Portfolio & Technical Strategy. “While we are positive over the next six to 12 months, we would not be surprised for the road to be bumpy in the coming weeks and months.” It has become a familiar story, but we’ll be sure to continue to see it through together. We hope you had a safe and fulfilling Thanksgiving and that this letter finds you well. Thank you for your continuing trust in us. As usual, if you have any questions or would like to discuss any aspect of your investments or financial plan, please be in touch. Sincerely,Peck Bulgin Wealth Managementof Raymond James245 Riverside Avenue, Suite 500. Jacksonville, FL 32202 Investing involves risk, and investors may incur a profit or a loss. All expressions of opinion reflect the judgment of the authors and are subject to change. There is no assurance the trends mentioned will continue or that the forecasts discussed will be realized. Past performance may not be indicative of future results. Economic and market conditions are subject to change. The S&P 500 is an unmanaged index of 500 widely held stocks. An investment cannot be made in this index. Investing involves risk and investors may incur a profit or a loss regardless of strategy selected. Material prepared by Raymond James for use by its advisors.